WASHINGTON JOURNAL OF LAW, TECHNOLOGY & ARTS
VOLUME 6, ISSUE 2 AUTUMN 2010
DEATH OF THE SPAM WRANGLER: CAN-SPAM PRIVATE
PLAINTIFFS REQUIRED TO SHOW ACTUAL HARM
Susuk Lim*
© Susuk Lim
CITE AS: 6 WASH J.L. TECH. & ARTS 155 (2010)
https://digital.lib.washington.edu/dspace-law/handle/1773.1/480
ABSTRACT
In Gordon v. Virtumundo, the United States Court of Appeals for
the Ninth Circuit published its first opinion on private plaintiff
standing requirements for actions under the federal CAN-SPAM Act.
The court strictly interpreted CAN-SPAM’s enforcement language,
rejecting attempts by professional litigants to insert themselves into
CAN-SPAM’s limited private right of action. This Article analyzes
Gordon’s treatment of CAN-SPAM’s private right of action and
federal preemption provisions. It concludes by assessing the decision’s
expected effect on future spam-related litigation.
TABLE OF CONTENTS
Introduction .................................................................................... 156
I. The CAN-SPAM Act of 2003 .................................................. 156
II. The Gordon Decision ................................................................ 159
III. Gordon’s Effects on Future Spam Litigation ............................ 161
A. Higher Threshold for Internet Access Service (IAS)
Status ................................................................................. 162
B. The “Adversely Affected” Test and Required Showing of
Actual Harm ...................................................................... 165
C. CAN-SPAM Preempts Overlapping State Law................. 167
D. Prevailing Defendants May Be Awarded Attorney’s Fees 168
*
Susuk Lim, University of Washington School of Law, Class of 2011. Thank
you to Professor Anita Ramasastry and student editor Jessica Lee Blye.
156
WASHINGTON JOURNAL OF LAW, TECHNOLOGY & ARTS [Vol. 6:2
Conclusion ...................................................................................... 168
Practice Pointers .............................................................................. 169
INTRODUCTION
The public furor over unsolicited commercial e-mail, known as
spam, has fed a cottage industry dedicated to profiting from statutory
damages codified in the CAN-SPAM Act of 2003.1 Uncertainty about
the scope of CAN-SPAM’s private right of action and limited
precedent left courts largely powerless to dismiss such claims without
expending significant resources on evaluating their individual merits.
In its landmark Gordon v. Virtumundo decision, the Ninth Circuit
erased many, but not all, of these ambiguities. It derived eligibility
from legislative intent and held that CAN-SPAM’s private standing
requirements should be narrowly construed.2 The court also held that
eligible private plaintiffs must demonstrate actual harm of a specific
type and causation.3 Finally, the court determined that CAN-SPAM’s
preemption clause was broad, only allowing spam-related litigation
under state law if the violation materially and intentionally references
the state law at issue and the law itself specifically relates to falsity or
deception.4 Gordon largely shuts out professional plaintiffs from CANSPAM eligibility. It also modifies the requirements for legitimate
claimants, necessitating a change in litigation approach.
I. THE CAN-SPAM ACT OF 2003
Unsolicited bulk and commercial e-mail messages, known as spam,
are sent in large quantities to indiscriminate sets of recipients. During
the first half of 2009, spam constituted 85.5% of all e-mail traffic.5
1
Controlling the Assault of Non-Solicited Pornography and Marketing (CANSPAM) Act of 2003, 15 U.S.C. §§ 7701-7713 (2006); See, e.g., Mike Masnick, Serial
Anti-Spam Lawsuit Filer Loses Appeal . . . And His Possessions, TECHDIRT (Aug. 24, 2009,
10:25 AM), http://www.techdirt.com/articles /20090821/0334155954.shtml.
2
See Gordon v. Virtumundo, 575 F.3d 1040, 1051 (9th Cir. 2009).
3
See id. at 1053-54.
4
See id. at 1063.
5
Kaspersky - Spam Volume Remained High in H1 2009 Despite Economic Crisis,
2010]
DEATH OF THE SPAM WRANGLER
157
This ever-rising tide of spam has caused public consternation and high
business spending toward network and business asset protection.6
Legislators balanced this public sentiment with the economic and
marketing utility of legitimate commercial e-mail when they drafted
and subsequently enacted CAN-SPAM in 2003.7
CAN-SPAM governs the content, representation, and delivery of
commercial e-mail.8 It does not outlaw unsolicited e-mail outright.
Commercial e-mail is only unlawful if it does not allow for verifiable
and timely user-initiated unsubscription,9 contains inaccurate or
misleading sender information,10 or is sent under or through falsified
means.11 CAN-SPAM also limits standing to governmental and regulatory bodies, but provides a limited private right of action to a class of
plaintiffs it terms Internet access services (“IASs”).12 The term “Internet
access service” is statutorily defined as “a service that enables users to
access content, information, electronic mail, or other services offered
over the Internet, and may also include access to proprietary content,
information, and other services as part of a package of services offered
to consumers.”13 In the absence of precedent, this language was sufficiently ambiguous to cause most courts to construe the definition very
SPAM FIGHTER (Nov. 9, 2009), http://www.spamfighter.com/News-13076-Kaspersky%E2%80%93-Spam-Volume-Remained-High-in-H1-2009-Despite-EconomicCrisis.htm
6
See Rebecca Lieb, Make Spammers Pay Before You Do, ISP-PLANET (Jul. 31,
2002), http://www.ispplanet.com/business/2002/spam_cost.html.
7
See 15 U.S.C. § 7701 (2006).
8
See 15 U.S.C. § 7702(2) (2006).
9
15 U.S.C. § 7704(a)(3)(A)(i) (2006).
10
15 U.S.C. § 7704(a)(2) (2006).
11
See 15 U.S.C § 7704(b) (2006).
12
See 15 U.S.C. § 7706(g)(1) (2006).
13
47 U.S.C. § 231(e)(4) (2006).
158
WASHINGTON JOURNAL OF LAW, TECHNOLOGY & ARTS [Vol. 6:2
broadly.14
IASs are only granted CAN-SPAM standing if they suffer adverse
effects as a result of a substantive CAN-SPAM violation.15 The courts
generally construed CAN-SPAM’s “adverse effects” language to require
a showing of both sufficient extent of harm as well as type of harm
generally suffered by IASs.16 However, the courts broadly refused to
require a showing of any connection between specific violations and
alleged harm.17
The Act provides for statutory damages of up to $100 per violating
message18 and $1,000,000 in aggregate.19 It allows treble damages for
aggregated or willful violations.20 The Act also preempts related state
law that “expressly regulates the use of electronic mail to send
commercial messages, except to the extent that [it] prohibits falsity or
deception.”21 State laws not specific to electronic mail are saved from
preemption, as are laws addressing fraud or computer crime.22
Between CAN-SPAM’s steep statutory damages, the ease of meeting its standing requirements, and widespread public hatred for spam,
it is easy to see how an unscrupulous private plaintiff could make a
significant amount of money by manipulating the previous regime.
14
See, e.g., Ferguson v. Quinstreet, No. C07-5378RJB, 2008 WL 3166307, at *5
(W.D. Wash. Aug. 5, 2008) (in the absence of guidance, the term must be given its
broadest definition under CAN-SPAM); MySpace v. The Globe.com, No. CV063391-RGK(JCx), 2007 WL 1686966, at *3 (C.D. Cal. Feb. 27, 2007) (IAS providers
can include any traditional ISP, any e-mail provider, and most Web site owners);
Hypertouch v. Kennedy-Western Univ., No. C04-05203SI, 2006 WL 648688, at *3
(N.D. Cal. Mar. 8, 2006) (holding that providing e-mail service alone, without any
other services, was sufficient to qualify as an IAS under CAN-SPAM).
15
See, e.g., Ferguson, 2008 WL 3166307; MySpace, 2007 WL 1686966, at *3;
Hypertouch, 2006 WL 648688, at *3.
16
See, e.g., ASIS Internet Servs. v. Optin Global, No. C-05-05124JCS, 2008 WL
1902217, at *17 (N.D. Cal. Apr. 29, 2008); Brosnan v. Alki Mortgage, No.
C074339JL, 2008 WL 413732, at *2 (N.D. Cal. Feb. 13, 2008); Hypertouch, 2006 WL
648688, at *4.
17
See, e.g., Optin Global, 2008 WL 1902217, at *5-6.
18
15 U.S.C. § 7706(g)(3)(A)(i) (2006).
19
15 U.S.C. § 7706(g)(3)(B) (2006).
20
15 U.S.C. § 7706(g)(3)(C) (2006).
21
15 U.S.C. § 7707(b)(1) (2006).
22
15 U.S.C. § 7707(b)(2) (2006).
2010]
DEATH OF THE SPAM WRANGLER
159
One CAN-SPAM defendant complained somewhat prophetically that
such “a broad interpretation [would] create a flood of suits by ‘spam
litigation mills.’”23
II. THE GORDON DECISION
The Ninth Circuit chilled the potential anti-spam litigation industry with its decision in Gordon.24 Appellant James S. Gordon was
variously described as an “anti-spam enthusiast” and “professional
plaintiff,” whose sole source of income was monetary settlements from
his litigation campaign.25 His technique was to configure several Internet domains and e-mail inboxes under his control to not only passively
accept spam but also to actively seek it. Once spam messages began
arriving, Gordon would sue the senders or relaying providers. One
such provider was Virtumundo, Inc., an e-mail marketing firm.
The district court determined that Gordon lacked CAN-SPAM
standing and granted Virtumundo’s motion for summary judgment.26
It held that while Gordon qualified as an IAS under the prevailing
definition of the term,27 he failed to show adverse harm because any
harm he suffered was the same as that suffered by ordinary e-mail
users.28 The court further held that since Virtumundo did nothing to
hide its e-mail domains from end-users, it did not materially falsify or
deceive, thus negating any claim Gordon might have had under state
law via CAN-SPAM’s preemption exception.29
Gordon appealed and the U.S. Court of Appeals for the Ninth
Circuit affirmed the district court’s decision in a strongly worded and
decisive ruling. First, it explicitly rejected a broad interpretation of the
23
ASIS Internet Servs. v. Active Response, No. C076211TEH, 2008 WL
2952809, at *6 (N.D. Cal. Jul. 30, 2008) (quoting defendant).
24
See Gordon v. Virtumundo, 575 F.3d 1040 (9th Cir. 2009).
25
Id. at 1056.
26
See Gordon v. Virtumundo, No. 06-0204-JCC, 2007 WL 1459395, at *15
(W.D. Wash. May 15, 2007).
27
See id. at 8.
28
See id.
29
See id. at 12.
160
WASHINGTON JOURNAL OF LAW, TECHNOLOGY & ARTS [Vol. 6:2
definition of IAS.30 Although the court noted that the actual definition
of IAS may have a technical or hardware prerequisite, it refused to set
forth any general test or definitional boundaries.31 Nevertheless, the
court considered CAN-SPAM’s legislative intent and determined that a
plaintiff was not an IAS because it had no control over the serving
hardware and did not provide any service the service provider could
not offer. As Gordon provided no actual services beyond what was
already freely available to his “customers,” the court determined that
he did not qualify as an IAS.
Second, the Ninth Circuit added a two-part extent of harm
requirement to the existing “adversely affected” test, which only necessitated showing adequate type of harm. The resulting test has three
elements: (1) that there be, “at bare minimum, a demonstrated relationship between purported harms and the type of e-mail practices
regulated by the Act,”32 (2) the type of harm suffered must be “both
real and of the type experienced by ISPs,”33 and (3) any ISP-type harm
suffered must be above and beyond the ordinary difficulties suffered by
the normal operation of the ISP, even after normal reasonable precautions to avoid them.34 Gordon failed on all counts. He could not
proffer evidence of a connection between spam and his purported
harms; he only suffered harm of the type ordinarily incurred by ordinary consumers. Even if he could meet the first two criteria, his efforts
in actually attracting spam could not be construed as reasonable
precautions to avoid it. The court noted that, for fear of creating an
impossibly high standard, it was not requiring direct evidence of harm
from specific e-mails. It merely required evidence of general harm of the
correct type and extent.35
Finally, citing Omega Travel v. Mummagraphics, the Gordon court
30
See Gordon, 575 F.3d at 1051.
See id. at 1052.
32
Id. at 1054.
33
Id. at 1053.
34
Id. at 1054.
35
See id. at 1054 n.12. While the court noted the impracticability of tracing
harm to a specific set of offending e-mails, it did not offer concrete examples of what
it considered to be sufficiently harmful. Instead, the court reserved the future possibility of requiring evidence of specific e-mails causing alleged harm.
31
2010]
DEATH OF THE SPAM WRANGLER
161
held that not only did Gordon’s state claims fail to qualify for CANSPAM’s preemption exception, but the state law itself was preempted.36 The court seized on CAN-SPAM’s stated legislative intent
that the act regulate commercial e-mail “on a nationwide basis”37 and
only excepted state laws that “target fraud or deception.”38 The Omega
court did not find that state laws prohibiting “mere error” or “insignificant inaccuracies” qualified as exceptions to preemption.39 The Gordon court found that the state law in question, Washington’s
Commercial Electronic Mail Act (CEMA),40 was substantially aimed at
the same goals as CAN-SPAM and was thus preempted, regardless of
CEMA’s incidental language treating falsity or deception.41 Such
language, the court opined, left open the possibility of violation by
inaccuracy, rather than intent, and thus ran afoul of Omega’s preemption of statutes punishing “mere error” or technicalities.42 In Gordon’s
case, because Virtumundo did nothing to hide the identity of its
e-mails from discovery easily accessible by the public, Gordon’s assertion of falsity and deception were without merit, and his state CEMA
claims were preempted by his failed federal CAN-SPAM claims.
III. GORDON’S EFFECTS ON FUTURE SPAM LITIGATION
The Gordon decision drew mixed reactions. Some lauded the Ninth
Circuit for sweeping away frivolous litigation and sharpening CANSPAM’s focus,43 while others criticized what they perceived as a
36
See Gordon, 575 F.3d at 1060-62 (citing Omega World Travel v. Mummagraphics, 469 F.3d 348 (4th Cir. 2006)).
37
Id. (citing 15 U.S.C. § 7701(b)(1) (2006)).
38
Id.
39
Omega, 469 F.3d at 354-55.
40
WASH. REV. CODE § 19.190.030 (2010).
41
See Gordon v. Virtumundo, 575 F.3d 1040, 1064 (9th Cir. 2009).
42
Id.
43
See, e.g., Bruce Nye, CAN-SPAM Act–Common Sense From the Ninth Circuit, CAL
BIZ LIT (Aug. 10, 2009, 9:19 AM), http://www.calbizlit.com/cal_biz_lit/2009/
08/canspam-act-common-sense-from-the-ninth-circuit.html; David Johnson, CANSPAM Update: Ninth Circuit Ruling Shuts Down Anti-SPAM Cottage Industry, DIGITAL
MEDIA LAWYER BLOG (Aug. 20, 2009), http://www.digitalmedialawyerblog.com/
162
WASHINGTON JOURNAL OF LAW, TECHNOLOGY & ARTS [Vol. 6:2
weakening of anti-spam measures.”44 The debate centers on a widely
disparate portrayal of Gordon himself; those in favor of the ruling
viewed Gordon as an opportunistic litigant, while those against praised
him as a scrupulous and canny anti-spam crusader.
Whatever Gordon’s true motivations, the Ninth Circuit used a
less-than-favorable view to assess his claims and formulate its holding.45
Generally, the court sought to separate the actual law as codified in
CAN-SPAM from sentiment as to what it should have been.46 The
Ninth Circuit singularly emphasized the congressional intent behind
CAN-SPAM in every part of its analysis, which has wide-ranging implications on private standing for future related litigation.47
A. Higher Threshold for Internet Access Service (IAS) Status
As noted above, prior to Gordon, courts construed CAN-SPAM’s
IAS definition broadly but inconsistently. While CAN-SPAM uses the
definition of “Internet” from the Internet Tax Freedom Act (ITFA),48
it does not use the ITFA’s definition of either IAS or the more
restricted “Internet access provider,” which specifically invoked hardware-based Internet service providers (ISPs).49 Instead, it uses a much
broader IAS definition50 from the Child Online Protection Act,51
2009/08/digital_media_law_ninth_circui.html.
44
See, e.g., J. Craig Williams, Prying Back The Lid On The CAN-Spam Act: No Private Right To Challenge Spammers, MAY IT PLEASE THE COURT (Aug. 9, 2009, 7:54
AM), http://www.mayitpleasethecourt.com/journal.asp?blogid=2025.
45
See Gordon, 575 F.3d at 1055 (“It is readily apparent that Gordon, an individual who seeks out spam for the very purpose of filing lawsuits, is not the type of
private plaintiff that Congress had in mind.”).
46
Gordon, 575 F.3d at 1056 n.15 (“As should be apparent here, ‘the law’ that
Gordon purportedly enforces relates more to his subjective view of what the law
ought to be, and differs substantially from the law itself.”).
47
See id. at 1057 (“The CAN-SPAM Act was enacted to protect individuals and
legitimate businesses—not to support a litigation mill for entrepreneurs like Gordon.”).
48
47 U.S.C. § 151 (2006).
49
Id.
50
See 15 U.S.C. § 7702(11) (2006).
51
47 U.S.C. § 231(e)(4) (2006).
2010]
DEATH OF THE SPAM WRANGLER
163
which not only includes ISPs such as Comcast, and Verizon DSL, but
also meta-level service providers.52
Gordon carved out an exception to this broad definition by excluding professional litigants and other small-time private plaintiffs like
blog owners or personal Web site operators. The court “reject[ed] any
overly broad interpretation of ‘Internet access service’ that ignore[d]
congressional intent,” which generally viewed CAN-SPAM as only
applicable to those in the best position to regulate spam and not those
who merely received it.53 Though the court refused to lay down any
specific test, it advised that subsequent courts should “inquire into the
plaintiff’s purported Internet-related service operations” in questionable cases and determine what purpose those operations served.54 Even
if the operations were legitimate, their scale and complexity must be
weighed; those providing a “nominal role in providing Internet-related
services” cannot qualify.55
The court used Gordon’s enterprise as an example of a non-IAS,
even though it met CAN-SPAM’s literal IAS definition. On its face,
this appears to violate the Ninth Circuit’s general precedent that “the
legislative purpose of a statute is expressed by the ordinary meaning of
the words used.”56 Gordon’s service appears to enable users to access
e-mail, fitting squarely within the literal CAN-SPAM IAS definition.
However, the Gordon court distinguished Gordon’s enterprise from
IAS classification by noting its lack of value.57 It observed that Gordon
failed to operate as a bona-fide e-mail provider; he “avoided taking
even minimal efforts to avoid or block spam” and instead actively
52
See Ethan Ackerman, Just Who Is an Internet Access Service Provider Under CANSPAM?, TECHNOLOGY AND MARKETING LAW BLOG (Nov. 14, 2008, 1:29 AM),
http://blog.ericgoldman.org/archives/2008/11/just_who_is_an.htm (asserting that
Web sites like Facebook, Google, etc. also fall under the CAN-SPAM definition of
IAS).
53
Gordon v. Virtumundo, 575 F.3d 1040, 1050-51 (9th Cir. 2009).
54
Id. at 1055.
55
See id. at 1052.
56
Leisnoi, Inc. v. Stratman, 154 F.3d 1062, 1066 (9th Cir. 1998); accord
Seldovia Native Ass’n v. Lujan, 904 F.2d 1335, 1341 (9th Cir. 1990).
57
See Gordon, 575 F.3d at 1051-52.
164
WASHINGTON JOURNAL OF LAW, TECHNOLOGY & ARTS [Vol. 6:2
accumulated it for the purposes of initiating litigation.58 The court also
cited Gordon’s lack of involvement in the creation of his e-mail
service, which was limited to using a home computer to access a much
larger e-mail provider’s services.59 The court determined that Gordon’s
service was not a service at all, as it did not provide users access to
Internet resources beyond what was already available to them.60
The Ninth Circuit’s decision sets the IAS threshold considerably
higher, especially for professional plaintiffs. The decision’s effect on
more legitimate enterprises is still unclear, however. There is little to
distinguish the methods used to set up legitimate e-mail domains,
blogs, etc.—some of which may attract thousands or millions of users—
from those employed by Gordon. The Ninth Circuit’s expressly incomplete guidance on the matter suggests that it may have targeted
Gordon’s dubious aims rather than the lack of complexity or utility of
his methods.61
The Ninth Circuit’s precedent creates a definitional continuum for
IAS status, requiring fact-based inquiry to determine eligibility. On the
one hand, services created specifically to enable litigation are categorically ineligible. On the other hand, entities allowing primary access to
the Internet itself or other legitimate Internet-based services—social
networking and e-mail, for instance—are covered under IAS’ generally
broad definition. The threshold is less clear for plaintiffs between the
extremes, especially for those providing secondary services such as
personal blogs or family e-mail domains.
The Ninth Circuit’s rule of statutory construction seemingly cabins
the Gordon IAS limitations to explicitly illegitimate or useless services.
Had Gordon actually maintained legitimate e-mail services for his
clients, the court’s analysis would have been a significantly closer
proposition. Professional plaintiffs may begin “spam farming” more
passively to avoid the elevated threshold.
58
Gordon, 575 F.3d. at 1052.
Id.
60
See id.
61
See Eric Goldman, An End to Spam Litigation Factories?, TECHNOLOGY AND
MARKETING LAW BLOG (Aug. 7, 2009, 12:40 PM), http://blog.ericgoldman.org/
archives/2009/08/an_end_to_spam.htm.
59
2010]
DEATH OF THE SPAM WRANGLER
165
B. The “Adversely Affected” Test and Required Showing of Actual Harm
Even if a private plaintiff can show bona-fide IAS status, under
Gordon they must now show that they were both adversely affected by
IAS-type harm and that the harm was real, with an extent beyond that
of “mere annoyance . . . and greater than the negligible burdens typically borne by an IAS provider in the ordinary course of business.”62
As before, the CAN-SPAM Act redresses only harms that parallel
its limited private right of action, including harms unique to IAS
providers such as “investing in new equipment to increase capacity[,]
customer service personnel to deal with increased subscriber complaints, [and] maintaining e-mail filtering systems and other anti-spam
technology.”63 Gordon made it clear that consumer-related harms are
irrelevant to CAN-SPAM analysis, not only neutralizing claims by
private consumers, but also claims by IASs based partially or entirely
on, for example, loss of personal data.64 Such claims must now seek
redress for the derivative effects of consumer-related harms, such as
additional customer service costs.65
However, the calculation of adverse effect under CAN-SPAM now
includes a baseline element. The Gordon court differentiates between
the fixed and variable costs of spam prevention, and notes that subsequent courts must “be careful to distinguish the ordinary costs and
burdens associated with operating an Internet access service from
actual harm.”66 The court “expect[s] a legitimate service provider to
secure adequate bandwidth and storage capacity and take reasonable
precautions, such as implementing spam filters, as part of its normal
operations.”67 The court seems to view spam as an expected part of the
Internet industry, and any showing of actual harm for the purposes of
CAN-SPAM standing must be above and beyond the normal expenses
62
63
64
65
66
67
Gordon, 575 F.3d at 1054.
Id. at 1053.
Goldman, supra note 61.
See Gordon, 575 F.3d at 1054.
Id.
Id.
166
WASHINGTON JOURNAL OF LAW, TECHNOLOGY & ARTS [Vol. 6:2
required to counteract it.68 “Network slowdowns, server crashes,
increased bandwidth usage, and hardware and software upgrades bear
no inherent relationship to spam or spamming practices,” and
evidence of them alone is insufficient to show that the IAS was
adversely affected by misconduct.69 Such events must be accompanied
with evidence that “the e-mails at issue . . . contribute to a larger,
collective spam problem that cause ISP-type harms.”70
This seems to imply that an influx of spam of an unusual amount
or insidiousness, mapped to a specific and abnormal IAS-type harm, is
required for private standing under CAN-SPAM. However, due to
what the Ninth Circuit perceived as “the impracticability of tracing
harm to a specific e-mail or batch of e-mails,” it refused to impose “a
direct causation requirement,” though it reserved the right to do so in
future litigation.71
Gordon’s stricter private standing requirements are effectively
waived for “well-recognized ISPs or plainly legitimate Internet access
service providers.”72 It reasoned that “adequate harm might be presumed because any reasonable person would agree that such entities
dedicate considerable resources to and incur significant financial costs
in dealing with spam.”73 For these plaintiffs, standing under CANSPAM is automatically granted. Conversely, harms alleged by plaintiffs
with questionable IAS status should be “closely examine[d].”74 This
language has the effect of bifurcating the “adverse effect” requirements
for large commercial providers and smaller enterprises.75 It should be
noted that Gordon left open the question of what characterizes a
“recognized” ISP or a “plainly legitimate” IAS.
As with its restriction of the IAS definition, the Gordon court’s
holding on the CAN-SPAM harm elements invalidates most profes-
68
69
70
71
72
73
74
75
Goldman, supra note 61.
Gordon, 575 F.3d at 1054.
Id.
Gordon, 575 F.3d at 1054 n.12.
Id. at 1055.
Id.
Id.
Goldman, supra note 61.
2010]
DEATH OF THE SPAM WRANGLER
167
sional litigants’ standing arguments. It also requires a higher standing
threshold for private plaintiffs of all but the largest and most well
recognized IASs.
C. CAN-SPAM Preempts Overlapping State Law
Gordon’s application of Omega World Travel v. Mummagraphics is a
definite statement of CAN-SPAM’s preemption of applicable state law.
One of CAN-SPAM’s stated aims is to address the states’ disparate
standards for commercial e-mail, which it found to be incompatible
with the geographically independent nature of e-mail.76 However, in
some states, CAN-SPAM’s enactment resulted in the creation of new
anti-spam laws to work around the preemption statute, making enterprises like Gordon’s more successful because of the additional state law
action at their disposal.77 These new laws were often more lax about
standing and causation, sometimes focusing on the perpetrator’s knowledgeable intent of their actions rather than any actual harm suffered
by recipients, and provided any private recipient or Web site owner
with a right of action.78
Just as the Omega decision invalidated these quickly-revised state
laws in the Fourth Circuit, Gordon’s affirmation of Omega’s principles
may negate similarly situated state laws in the Ninth Circuit, following
its disqualification of Washington’s CEMA in Gordon. It is important
to note that Gordon and Omega only interpret CAN-SPAM as preempting state laws specific to electronic mail; other laws, including statutes
targeting fraud or computer crime, are still viable for litigation.79
However, as Gordon demonstrated, such state claims must not be based
on other, explicitly preempted grounds.80
76
15 U.S.C. §7701(a)(11) (2006).
See Goldman, supra note 61.
78
See, e.g., State v. Heckel, 93 P.3d 189, 192-94 (Wash. App. 2004) (assessing
defendant’s liability for violating Wash. Rev. Code 19.190.020 in terms of constructive
knowledge of receipt).
79
Gordon v. Virtumundo, 575 F.3d 1040, 1065 n.24 (9th Cir. 2009).
80
See id. at 1064-65 n. 23.
77
168
WASHINGTON JOURNAL OF LAW, TECHNOLOGY & ARTS [Vol. 6:2
D. Prevailing Defendants May Be Awarded Attorney’s Fees
Virtumundo was able to recover attorney’s fees from Gordon at the
district court level. This may have been the first time a defendant had
prevailed in collecting attorney’s fees in a CAN-SPAM action.81 The
district court found that since CAN-SPAM was intended to have a
limited private right of action, a dual-standard approach to attorney’s
fees where plaintiffs’ requests are always viewed favorably was not
appropriate.82 Congress’ intent, it reasoned, was not for “private
parties with no harm to invoke CAN-SPAM [and] collect millions of
dollars.”83 The district court concluded that CAN-SPAM was best
suited for an even-handed approach under Fogerty, wherein a prevailing
defendant’s request for remuneration would be “‘evaluated no
differently than the question to whether to award fees to a prevailing
plaintiff.’”84 Upon evaluating Gordon’s serial litigation tendencies, the
district court found ample reason to award Virtumundo attorney’s fees
with the “goal of deterrence.”85
This novel reasoning was not addressed and thus not explicitly
overruled by the Ninth Circuit. The district court turned professional
litigation under CAN-SPAM into a much riskier financial proposition
in the Western District of Washington; the Ninth Circuit’s silence on
the matter may move other courts in its jurisdiction to rule similarly.
CONCLUSION
Gordon effectively neutralizes most professional plaintiffs’ standing
arguments in the Ninth Circuit under CAN-SPAM’s private right of
action. First, the threshold question of whether a plaintiff is an IAS
81
Eric Goldman, CAN-SPAM Defendant Awarded $111k in Fees/Costs: Gordon v.
Virtumundo, CIRCLEID (Aug. 6, 2007, 4:44 PM), http://www.circleid.com/posts/
070806_can_spam_act_gordon_virtumundo.
82
Gordon v. Virtumundo, No. 06-0204-JCC, at *5-6 (W.D. Wash. Aug. 1, 2007)
(order granting attorney’s fees), available at http://www.spamnotes.com/files/3123629497/Virtumundo_Order.pdf.
83
Id. at *7.
84
Id. at *5 (citing Fogerty v. Fantasy, 510 U.S. 517, 534 (1994)).
85
Id. at *10.
2010]
DEATH OF THE SPAM WRANGLER
169
involves close judicial scrutiny regarding its underlying purpose.
Second, if the plaintiff is an IAS, it must show that it suffered significant IAS-type harm above and beyond ordinary inconvenience from a
normal spam volume. Third, should the plaintiff’s CAN-SPAM claim
fail, the viability of a parallel state claim is now highly questionable.
Finally, if the court determines that the claim is frivolous, the plaintiff
runs the risk of being responsible for the defendant’s legal fees and
costs.
A side effect of the Ninth Circuit’s methodical dissolution of
CAN-SPAM litigation factories is that legitimate Web site operators
and e-mail providers have a higher standard of harm, and possibly
threshold IAS standing, to meet. Large and well-known providers and
operators, however, may automatically be presumed to have standing
with little inquiry into the merits of their claims.
PRACTICE POINTERS
Examine the legitimacy and motives of private plaintiffs. New
Ninth Circuit CAN-SPAM standing requirements make it difficult
for litigation factories to succeed in court.
Provide evidence of complexity, utility, and specialty. The more
useful, involved, or unique the service provided by the plaintiff,
the more likely they are to attain IAS status.
Emphasize omnipresence or legitimacy of the service. A showing of
obvious legitimacy of the plaintiff’s service, or widespread recognition as an ISP, effectively bypasses the stringent “adversely affected
by” requirements of the Ninth Circuit.
Concentrate on materially deceptive practices. Mere errors and
technical glitches are not likely to meet the standard under either
federal or state law.
Be prepared to defend against claims for attorney’s fees. If the defendant prevails, it is possible that the court will use the Fogerty
even-handed standard for determining costs.